EFTA00619645.pdf

1 IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT IN AND FOR PALM BEACH COUNTY, FLORIDA GENERAL JURISDICTION DIVISION JEFFREY EPSTEIN, Plaintiff, vs. No. 502009CA040800XXXXMBAG SCOTT ROTHSTEIN, individually, and BRADLEY J. EDWARDS, individually, Defendants. 500 East Broward Boulevard, Ft. Lauderdale, Florida Thursday, June 14, 2012 9:14 a.m. - 12:37 p.m. DEPOSITION Of SCOTT ROTHSTEIN (Via Video Conference) Taken on behalf of the Trustee pursuant to a notice of taking deposition FRIEDMAN. LOMBARDI & OLSON EFTA00619645  2 1 APPEARANCES: 2 LAW OFFICES OF TONJA HADDAD, P.A. by 3 Tonja Haddad, Esq. Attorney for the Plaintiff. 4 5 ATTERBURY, GOLDBERGER & WEISS, P.A., by Jack Goldberger, Esq. 6 Attorney for the Plaintiff. 7 SEARCY DENNEY SCAROLA ET AL, by 8 Jack Scarola, Esq. Attorney for the Defendant, Brad Edwards. 9 10 MARC NURIK, P.A., by Marc Nurik, Esq. 11 Attorney for Scott Rothstein. (Appearing via Video Conference.) 12 13 U.S. ATTORNEY'S OFFICE, by Laurence LaVecchio, Esq. 14 Attorney for the Department of Justice. 15 16 17 18 19 20 21 22 23 24 25 FRIEDMAN. LOMBARDI & OLSON EFTA00619646  3 1 INDEX 2 WITNESS DIRECT CROSS REDIRECT RECROSS 3 SCOTT ROTHSTEIN 4 (By Ms. Haddad) 5 5 (By Mr. Goldberger) 92 (By Mr. Scarola) 121 6 7 EXHIBITS 8 PLAINTIFF'S FOR IDENTIFICATION 9 10 1 64 2 69 11 3 72 12 13 14 15 16 17 18 19 20 21 22 23 24 25 FRIEDMAN. LOMBARDI & OLSON EFTA00619647  4 1 Thereupon: 2 SCOTT ROTHSTEIN, 3 was called as a witness and, having been duly sworn, 4 was examined and testified as follows: 5 THE WITNESS: I do. 6 MS. HADDAD: Good morning, Scott. How are 7 you? 8 THE WITNESS: Good morning, Tonja. How are 9 you? 10 MS. HADDAD: Fine, thank you. It's nice to 11 see you. 12 THE WITNESS: Good to see you, too. 13 MR. SCAROLA: Mr. Rothstein, I don't know 14 that you and I have met. I'm Jack Scarola, I'm 15 representing Brad Edwards and I know you know Brad 16 who's to my immediate left. 17 THE WITNESS: Hey, Brad, how are you? 18 Jack, good to see you. 19 MR. SCAROLA: Thank you. 20 MR. GOLDBERGER: Also present is another 21 Jack, Jack Goldberger, and I also represent Jeffrey 22 Epstein. To my right is Darryn Indyke -- 23 THE WITNESS: Good morning, Jack. 24 MR. GOLDBERGER: How are you today? 25 And to my right is Darryn Indyke, who is FRIEDMAN. LOMBARDI & OLSON EFTA00619648  5 1 Mr. Epstein's in-house counsel. 2 MR. INDYKE: Good morning. 3 THE WITNESS: Good morning, sir. 4 MR. NURIK: Good morning, everyone. 5 MR. GOLDBERGER: Hi, Marc, how are you? 6 MR. NURIK: Good. You'll be seeing my 7 shoulder most of the day. 8 MR. GOLDBERGER: Okay. 9 DIRECT EXAMINATION 10 BY MS. HADDAD: 11 Q. Well, Scott, I know you've talked about this 12 probably more than you even care to, but I'd like to 13 start a little bit asking you about the scheme at your 14 firm and how and when it started and things of that 15 nature just very briefly because I know you've covered 16 it many times. 17 MR. SCAROLA: It has been covered and 18 protocol precludes asking questions that have already 19 been answered and covering areas that have already 20 been covered, so we do object. 21 MR. GOLDBERGER: Your objection is noted. 22 BY MS. HADDAD: 23 Q. When did this first start? 24 A. It started back in '05, '06. The question 25 is a little bit vague for me because it started in a FRIEDMAN. LOMBARDI & OLSON EFTA00619649  6 1 different form than it ended because it started as 2 bridge loans and things of that nature, and then 3 morphed into the Ponzi scheme. But you are looking 4 back into the 2005 time frame for the very beginning. 5 Q. The 2005 time frame, that's when the bridge 6 loans started? 7 A. I can't be certain exactly what we were 8 doing. I need to see all the documents to tell you 9 what we were doing at what specific point in time. 10 Q. What made you decide to start doing this? 11 A. I started doing it out of greed and the need 12 to support the law firm, which was having significant 13 financial trouble at the time. 14 Q. And in 2005 had you moved over to 401 yet or 15 were you still in the building where Colonial Bank 16 was? 17 A. I don't remember. 18 Q. Do you recall approximately how many 19 attorneys you had working for you when it started? 20 A. I do not. Between five and ten, Tonja. 21 Q. Was it before you started acquiring 22 attorneys like you were acquiring cars and watches? 23 MR. SCAROLA: Object to the form of the 24 question, vague. 25 THE WITNESS: Yes. FRIEDMAN. LOMBARDI & OLSON EFTA00619650  7 1 BY MS. HADDAD: 2 Q. Well, who were you partners with when it 3 first started? 4 A. Stu Rosenfeldt. 5 Q. Okay. Anyone else? 6 A. Susan Dolin, I believe. It was definitely 7 Stu Rosenfeldt, Michael Pancier, and Susan Dolin may 8 have been partners of ours at that time, I'm not 9 certain. 10 Q. Because if memory serves me correctly, you 11 went from being in the One Financial Plaza Building to 12 the building across the street, it was Rothstein, 13 Rosenfeldt, Dolin and Pancier; is that correct? 14 A. Yes. 15 Q. And it was some time later that you moved 16 into the 401 Building, correct? 17 A. You are skipping one step. I went from One 18 Financial Plaza to Phillips, Eisinger, Koss, Kusnick, 19 Rothstein and Rosenfeldt. Then Stu Rosen£eldt and I 20 broke off and formed Rothstein Rosenfeldt. And then 21 Rothstein, Rosenfeldt, Dolin, Pancier over at the 22 Colonial Bank Building. And then we took the space in 23 the 401 Building and eventually moved over there and 24 that's when the real growth started. 25 Q. And when you say, "that's when the real FRIEDMAN. LOMBARDI & OLSON EFTA00619651  8 1 growth started," do you mean both the scheme -- do you 2 mean the scheme and the firm or either one or both? 3 A. Both. 4 Q. Do you recall approximately when you took 5 the space in the 401 Building? 6 A. I do not. 7 Q. At the time everything imploded, how many 8 partners did you have at the firm, do you recall? 9 A. Are you saying partners and shareholders? 10 Because remember, we had both, two designations. 11 Q. I want to start with just attorneys that 12 had -- not in your firm name but named as "partner" on 13 the cards, for example. 14 A. I'd have to see a list of all the employees. 15 We had a bunch. 16 Q. Do you recall about how many attorneys you 17 had working there? 18 A. Approximately 70. 19 Q. In the year before, do you recall how many 20 you had? 21 A. I do not. 22 Q. So how many equity partners did you have or 23 shareholders? I'm not sure of the word that we are 24 using. 25 A. Actual shareholders, equity shareholders FRIEDMAN. LOMBARDI & OLSON EFTA00619652  9 1 were two, me and Stu Rosenfeldt. 2 Q. And everyone else was just a partner for 3 title purposes? 4 A. There were shareholders for title purposes 5 and partners for title purposes. 6 Q. If someone was called a shareholder for 7 title purposes then, did they get to receive any of 8 the funds? Were they shareholders receiving money or 9 they were not considered shareholders in that sense? 10 MR. SCAROLA: Objection to the form of the 11 question. 12 THE WITNESS: What kind of funds are you 13 talking about? 14 BY MS. HADDAD: 15 Q. In general from the firm. When you say 16 equity shareholders, I understand that's you and Stu. 17 What I'm saying is, if you had someone else that was 18 named as a shareholder, why did you call them a 19 shareholder as opposed to a partner? 20 A. It was a title of prestige and achievement. 21 Q. So it was basically an ego thing, it had 22 nothing really to do with the finances or hierarchy of 23 the firm? 24 A. They got paid more generally, but it did not 25 have anything to do with distributions. FRIEDMAN. LOMBARDI & OLSON EFTA00619653  10 1 Q. When you were hiring and bringing in all 2 these new attorneys, did everyone come in as a 3 partner? 4 A. No. 5 Q. How did you decide who came in as a partner 6 and who came in as an associate? 7 A. Depended upon their level of expertise, 8 practice, book of business. It was a decision Stuart 9 and I made together on a case-by-case basis. 10 Q. So you and Stu where the -- were in charge 11 of hiring? 12 A. Stuart and I tried to consult on every 13 hiring decision, yes. 14 Q. Did you guys also decide salaries? 15 A. I generally decided the salary and then let 16 Stu know what I was going to do. And he would say if 17 he thought it was okay or if he thought it was too 18 much or too little, but I generally had free reign in 19 that regard. 20 Q. Did someone's book of business directly 21 correlate to the salary that you would offer? 22 A. That is a very broad question because it 23 depends upon what other needs we had for that 24 individual. 25 Q. What do you mean by "what other needs"? FRIEDMAN. LOMBARDI & OLSON EFTA00619654  11 1 A. Well, I'll give you a good example. My 2 lawyer, Mr. Nurik, his salary was directly related to 3 the fact that he was a great lawyer and had a solid 4 book of business. 5 Q. Yes. 6 A. David Boden, on the other hand, was, as I 7 previously testified, I don't know if you've had a 8 chance to read the testimony, but David Boden was not 9 only the general counsel to the law firm but he was 10 also -- acted as my consigliere in a significant 11 number of illegal operations and he was compensated 12 significantly for that, if that helps you understand 13 the difference. 14 Q. It does. 15 So, for example, when you were hiring former 16 judges, let's use that as an example, Pedro and Julio, 17 clearly they don't have a book of business coming in 18 because they haven't had clients, but they may carry 19 some sort of prestige or give some legitimacy, if you 20 will, to the firm. How would you decide the salary 21 for someone like that? 22 A. Stu and I would discuss it. It was more a 23 market issue than anything else, how much are judges 24 coming off the bench getting, how much business do we 25 think they can generate. FRIEDMAN. LOMBARDI & OLSON EFTA00619655  12 1 Q. Would you need to look at someone's book of 2 business if they were coming in just solely to be a 3 rainmaker for the firm prior to hiring them? 4 A. I discussed it with them. There were not 5 many people that I recall that I actually looked at 6 their numbers. Once David Boden was working for me I 7 had him check people's numbers, but I rarely looked. I 8 took most people's words for what they were 9 generating. 10 Q. My recollection is, you were always looking 11 to bring in more people, to hire more people, some of 12 us were somehow able to resist you while others were 13 not. How would you decide who you were looking at to 14 bring into your firm? 15 A. We were trying to develop, on the legitimate 16 side of the law firm, we were trying to develop real 17 talent, real practice groups. I mean, Brad is a 18 perfect example, great lawyer, got a great reputation. 19 You know, it was our hope that, you know, he was going 20 to be one of the people to actually in some ways 21 rescue the firm because he had a practice group that 22 could generate substantial income. You know, on the 23 legitimate side that's what we were trying to do, we 24 were trying to find the best and the brightest. 25 Q. Okay. With respect to bringing people that FRIEDMAN. LOMBARDI & OLSON EFTA00619656  13 1 you thought could bring a book of business, you just 2 said Brad, for example, that he had a legitimate 3 practice group with a good book of business. How did 4 you know that? 5 A. Everyone in the tort world that I had spoke 6 to spoke extremely highly of Brad, not only people I 7 already had working for me but other people that knew 8 him. He was very -- came very highly recommended to 9 us. 10 Q. Like who, for example? 11 A. We wanted him in there. We were trying to 12 develop a significant tort group and we thought that 13 he'd be a great part of it. 14 Q. Who besides Russ told you that about Brad? 15 A. It would have been other people in the tort 16 group. I don't want to guess, Tonja, as to which 17 other people told me, but it was -- well more than 18 Russ. 19 Q. Was it people within 20 A. Might have been people in politics that I 21 talked to that knew him because we had significant 22 input at the gubernatorial level with regard to tort 23 reform and the like, and there were people there who 24 knew who Brad was. It was more than one person that 25 told us that. FRIEDMAN. LOMBARDI & OLSON EFTA00619657  14 1 Q. Okay. When you were looking at people to 2 bring in to the firm to legitimize, as you said. Your 3 firm had a very unique area of practice and had a very 4 unique environment to which to work. How did you know 5 or how did you come to decide what people may or may 6 not fit into that? 7 A. Okay. Hang on one second. I think you just 8 accidentally misstated my testimony. 9 I was not bringing the people in to 10 legitimize the law firm. I was bringing them in to 11 the legitimate side of the law firm. The bulk of the 12 law firm, despite the lack of financial success, was a 13 large group of very honest, hard working lawyers 14 trying to do their best in difficult economic 15 conditions. There were some that were obviously not 16 legitimate. And the way I decided to bring people in, 17 again, it's really everything I just told you. Are 18 you looking for how I brought people into the Ponzi 19 scheme? 20 Q. No, right now I'm just asking about the firm 21 because, as I said, it's a very unique way in which to 22 practice and a very unique workplace environment with 23 politics and restaurants and parties at your home and 24 things of that nature. I'm asking, personality wise, 25 other than the book of business, how did you decide on FRIEDMAN. LOMBARDI & OLSON EFTA00619658  15 1 people that would be a good fit? 2 A. I looked for people that were outgoing, that 3 had the type of personality. On the legitimate side 4 of the business, people that had charisma that were -- 5 that could go out and hustle and try to develop a book 6 of business if they didn't have it. And as one of the 7 50 percent of the shareholders of the firm I was 8 trying to hire people I wanted to work with. 9 Q. Okay. When you would see people from whom 10 you would offer jobs, for example, as you mentioned 11 earlier with Brad and his practice, if somebody stated 12 that people told you that he was a good lawyer, did 13 you need to see him in action, so to speak, prior to 14 your deciding to hire them or would you just take 15 people at their word for it? 16 A. Some of people I saw in action; he wasn't 17 one of them. Steve Osber is an excellent example of 18 that. I hired Steve after he was beating the living 19 daylights out of me on the other side of a case. And 20 I certainly would ask around about the people. But 21 the people that I trusted -- see, I can't remember. I 22 think Gary Farmer was working for me before Brad, and 23 if I'm not mistaken he would have been one of the 24 people that I went to with regard to Brad because we 25 were really developing that whole tort group around FRIEDMAN. LOMBARDI & OLSON EFTA00619659  16 1 that time with Farmer and Fistos and Jaffe and 2 Mr. Edwards. 3 Q. Do you know where Mr. Edwards was working 4 when you first learned of him? 5 A. I don't recall whether he was working for 6 someone or had his own practice, I don't recall. 7 Q. When did you first learn about Brad? 8 A. I don't remember the time frame. 9 Q. Do you recall when you first met with him 10 regarding a job? 11 A. No. The easiest way to figure that out is 12 to go look at his personnel file, it will have the 13 notes saying when he met with me the first time. 14 Q. You don't have any recollection of your 15 first meeting with him? 16 A. No. As you know, I was hiring people left 17 and right and I was also unfortunately very busy doing 18 things I shouldn't have been doing, so I don't have a 19 specific recollection of when I hired him. I barely 20 have a specific recollection of when I hired me. 21 Q. But you did, in fact, meet with him? 22 A. I'm certain I met with him before I hired 23 him. I can't imagine although I did hire people 24 without meeting them. I did hire people based on 25 other people's word, if they were people within the FRIEDMAN. LOMBARDI & OLSON EFTA00619660  17 1 firm that I trusted. Because I always said, I had a 2 very simple, you lie or die by what you are telling 3 me. If you are telling me this guy is good and he's 4 not good, that's on you, it's going to hurt your 5 income. So I used to tell my partner, people that 6 were recommending people to me, don't sell me a bill 7 of goods just to get somebody in here because if you 8 do that it's going to come back on you, it's going to 9 affect your income and your ability to grow in the 10 firm. So with that admonishment, I might have very 11 well hired someone sight unseen based upon what 12 someone else told me. 13 Q. But you did meet with Brad you say before he 14 came in to work? 15 A. Now that I'm saying it out loud, I think I 16 did but really I'm guessing. I don't have a specific 17 recollection of meeting him. 18 Q. Do you recall if you knew that he had worked 19 as an assistant state attorney for a few years prior 20 to doing tort litigation? 21 A. I don't recall that one way or the other. 22 Q. So you wouldn't have asked Howard Scheinberg 23 or anybody about him before he came to work there? 24 A. I can't say that I wouldn't have asked 25 because, like I said, I might have asked. But FRIEDMAN. LOMBARDI & OLSON EFTA00619661  18 1 unfortunately, you are taking a little tiny spot out 2 of a very, very busy time period in my life and in the 3 life of the firm, so I can't tell you one way or the 4 other. 5 Q. I know you had a lot going on, I'm just 6 trying to see if you remember anything specific about 7 this. 8 Do you recall what salary you had offered 9 Brad to come join the firm? 10 A. I do not. You have to just try to 11 differentiate that what I knew then is a lot different 12 than what I know now so 13 Q. Meaning? 14 A. Obviously meaning that at the point in time 15 that I was hiring him or maybe a year after, I would 16 be able to tell you what I was paying him, but now 17 it's insignificant. I don't remember how much I was 18 paying him. 19 Q. Did you learn about his book of business or 20 know what kind of cases he was bringing in prior to 21 hiring him? 22 A. I do know that he -- I discussed either with 23 Russ, well, I know with Russ, and perhaps some other 24 people, I knew about the Epstein case. 25 Q. What did you know about it? FRIEDMAN. LOMBARDI & OLSON EFTA00619662  19 1 A. I knew that it was a significant case of 2 potentially significant value against an extremely 3 collectible pedophile, for lack of a better word. 4 Q. So was that case your primary motive in 5 bringing Brad into the firm? 6 A. I doubt it. I mean, I can't tell you one 7 way or the other, but I doubt that I would bring him 8 in just for one case because what if the case fails, 9 then I'm stuck with a lawyer who can't do anything, 10 you know. 11 I'm not saying, Brad, that you couldn't do 12 anything, I'm just saying that if I only relied on one 13 case, then if I bring a lawyer in for one case and one 14 case only, what do I do with him when the case is 15 over. 16 Q. How did you know that this case would be a 17 collectible case then? 18 MR. SCAROLA: I'm going to object to the 19 form of the question because it misstated the prior 20 testimony. The prior testimony was not that it was a 21 collectible case but that it was a case against a 22 "extremely collectible pedophile." 23 BY MS. HADDAD: 24 Q. What made you think that this case had any 25 financial value? FRIEDMAN. LOMBARDI & OLSON EFTA00619663  20 1 A. Epstein was a billionaire. 2 Q. Okay. Did you know anything about the 3 legitimacy or illegitimacy of the claims prior to 4 knowing he was a billionaire? 5 A. I knew what I was told. I didn't check it 6 out myself, but I trusted the people that told me. 7 Q. And who told you? 8 A. The only person I remember discussing it 9 with, as I sit here today, is Russ Adler. But if 10 Farmer and Jaffe and those guys were with me at the 11 time, I likely would have discussed it with them as 12 well. 13 Q. So were you aware of this case before you 14 made an offer to Brad to join the firm? 15 A. Yes. 16 Q. You said you didn't -- I don't want to 17 misquote you. You said you heard about it from other 18 people, but you didn't do anything to know that 19 personally. Was that before you made the offer of 20 employment? 21 A. I made the offer of employment based upon 22 what other people had told me about Brad. 23 Q. About Brad and his book of business or just 24 Brad and his legal skills? 25 A. Okay. When I say Brad, I mean Brad and his FRIEDMAN. LOMBARDI & OLSON EFTA00619664  21 1 book of business and his legal skills. 2 Q. Okay. 3 A. And his ability to generate business in the 4 future. 5 Q. You stated that you believed that you first 6 heard about these cases from Russ and then perhaps 7 from Brad. Once Brad was at the firm, did you keep up 8 with these cases, these Epstein cases? 9 MR. SCAROLA: Excuse me, I'm going to 10 object to the form of the question. It is an 11 inaccurate reflection of the prior testimony. It has 12 no predicate. There was no reference about having 13 heard about these cases from Brad. The names 14 mentioned were Adler, possibly Farmer, possibly 15 Jaffe. 16 BY MS. HADDAD: 17 Q. Once Brad started working at the firm, 18 you've already testified you already knew about these 19 Epstein cases, correct? 20 A. Yes. 21 Q. How did you keep abreast of these cases? 22 A. I didn't. 23 Q. You didn't know anything about them? 24 A. I didn't say I didn't know anything. I said 25 I didn't keep track of it. FRIEDMAN. LOMBARDI & OLSON EFTA00619665  22 1 Q. You didn't keep track of it? 2 A. I did not keep track of it. From time to 3 time Russ and the other guys in the tort group would 4 tell me what was going on in certain cases, but until 5 I made a decision to utilize that file for an illegal 6 purpose related to something illegal that I was doing 7 along with my co-conspirators, I just assumed my 8 lawyers were going to work the case and eventually it 9 would hopefully work out well for the law firm. 10 Q. At your firm, when e-mails would go out to 11 attorneys at RRA or all attorneys at RRA, were you 12 part of that e-mail group? 13 A. You are talking about all staff? 14 Q. No, all it says is attorneys at RRA. 15 A. It's the e-mail group "attorneys"? 16 Q. Yes. 17 A. Yes, I'm a part of that e-mail group. 18 Q. And I appreciate that you were very busy and 19 may not have read all of them, but you did receive 20 those e-mails when they would go around? 21 A. Yes, and I tried my best to read them. 22 Q. Okay. At what point did you decide to use 23 this case to further your Ponzi scheme? 24 A. I don't remember the date, but I can give 25 you the circumstances, if you'd like. FRIEDMAN. LOMBARDI & OLSON EFTA00619666  23 1 Q. Please do. 2 A. The Ponzi scheme was running very low on 3 capital My co-conspirators and I needed to find a 4 new feeder fund, new investment sources. We had a 5 couple of very large, significantly wealthy potential 6 investors out there. I was looking for something that 7 would have been very attractive. We had had a lot of 8 inquiry during the due diligence period with these 9 people that were doing due diligence on the putative 10 cases that we were selling. And when I thought about 11 the Epstein case, realizing that it was a substantial 12 actual file in the office, I came up with the idea 13 that if I created a fake confidential settlement 14 circling around -- based upon this actual case, they 15 would be able to increase the level of due diligence 16 that I was able to offer to my potential investors. 17 Q. How did you know this was a substantial file 18 in your office at that time? 19 A. Again, through the people I spoke to in the 20 office. 21 Q. Such as who? 22 A. Again, same people, Adler, Farmer, Jaffe, 23 Fistos. 24 Q. You never spoke to Brad about this case? 25 A. I didn't say that, but I had a lot more FRIEDMAN. LOMBARDI & OLSON EFTA00619667  24 1 interaction -- 2 Sorry, Tonja, I didn't mean to speak over 3 you. 4 If you talk to the people in the firm, if 5 they are honest with you, they'll tell you my 6 interaction was far more significant with Russ Adler, 7 probably more so because he was a co-conspirator of 8 mine. My interaction with Russ was far greater by 9 many, many percents over my interaction with Brad, and 10 then you go down the line. I had more interaction 11 with Mr. Farmer than I did with Mr. Fistos, more 12 interaction with Jaffe than I did with Mr. Edwards, 13 and so on. 14 Q. Russ was the head of your tort group, right? 15 A. Yes. 16 Q. So these cases fell under the tort group; is 17 that correct? 18 A. Yes, it fell under the fell under Russ' 19 purview ultimately, yes. 20 Q. And Brad was a partner at your firm during 21 the time these cases were there, correct? 22 A. I believe that was his title. He was either 23 partner or shareholder. I don't think we had made him 24 a shareholder yet. 25 Q. But he wasn't coming in as an associate, FRIEDMAN. LOMBARDI & OLSON EFTA00619668  25 1 correct? 2 A. To the best of my recollection, no. 3 Q. So you stated that you learned this case 4 was -- I don't want to misquote you and listen to a 5 long speaking objection, but what did you call this 6 case? 7 MR. SCAROLA: Who wants the quote? 8 THE WITNESS: It was a substantial case 9 with a -- what I perceived to be a highly collectible 10 pedophile as a defendant. 11 BY MS. HADDAD: 12 Q. Right. How did you know at the time when 13 you said these investors wanted to investigate and you 14 said you were going to create a fake settlement, how 15 did you know that this case was the case that you 16 could use? 17 A. From talking to all the people that I just 18 said, Adler, Fistos, Jaffe, Farmer, Mr. Edwards, to 19 the extent that I spoke to him about it. 20 Q. Did you speak with Mr. Edwards about the 21 case? 22 A. I don't have a specific recollection one way 23 or the other. I remember speaking to him at least 24 briefly the day or the day of or the day before the 25 actual investor's due diligence was going on as to FRIEDMAN. LOMBARDI & OLSON EFTA00619669  26 1 what was going on. And I may have spoke to him, I 2 know I spoke to Russ, but I may have spoke to him as 3 well within a couple of days just prior to this due 4 diligence because I was trying to at least get some 5 information in my head that I could use when I was 6 creating this story for the investors. 7 Q. Scott, what's Q-task? 8 A. Q-task is a web based software system that I 9 had invested $7 million in. 10 Q. And what was the purpose of this internet 11 system? 12 A. To be able to communicate in a secure 13 fashion and in a unique group fashion about specific 14 files. 15 Q. So forgive me, we all know I'm not good with 16 the computer. That was something that would be useful 17 within a law firm, why? 18 A. Because it allowed you to create groups and 19 have both general and private chats, organize data in 20 a very unique fashion. That was, at least to our way 21 of thinking, would have been very, very helpful in the 22 law firm setting with multiple practice groups. 23 Q. Did you belong to any groups on Q-task? 24 A. I'm certain that I did. I don't remember 25 which groups I belonged to. I never got into the full FRIEDMAN. LOMBARDI & OLSON EFTA00619670  27 1 use of it. I tried to, but again, I was very busy 2 doing other things. But I know that Mr. Adler's group 3 used it extensively. 4 Q. Because it was your firm and, as you said, 5 you invested $7 million in it, did you have the 6 ability to access a group if you wanted to? 7 A. Yes. And if I couldn't, I could get Russ to 8 give me access. 9 Q. So you didn't necessarily have to be invited 10 into the Q-task group for you to be able to utilize or 11 view the communications within it? 12 A. No, that's not true. I actually had to be 13 invited, that's what I was telling Russ to do, is to 14 have me invited. 15 Q. But I'm saying, the lawyers wouldn't have to 16 personally invite you, you can get someone within your 17 firm to give you access maybe without the lawyers 18 knowing? 19 A. No, I think it might have had a, quote, 20 unquote, confidential, super secret viewing 21 capability, but I don't recall it having that, and I'd 22 have no need to utilize that. Just invite me into the 23 group and let me see what's going on. 24 Q. Okay. I know that you are or were a very 25 hands-on person within certain of the practice groups FRIEDMAN. LOMBARDI & OLSON EFTA00619671  28 1 and with that, with the Q-task and the e-mails, did 2 someone assist you with reviewing everything and 3 letting you know what was going on within the groups? 4 MR. SCAROLA: Excuse me, I'm going to 5 object to counsel's testimony. Object to the form of 6 the question as leading. 7 THE WITNESS: I really don't even 8 understand the question. 9 Can you try to rephrase it for me, Tonja? 10 BY MS. HADDAD: 11 Q. Of course, I would. 12 Did you keep abreast of everything that was 13 going on in every practice group or was someone 14 through Q-task and e-mails, for example, or was 15 someone giving you information keeping you posted on 16 what was going on within the practice? 17 A. Well, as part of the tort group I had a 18 pretty good idea of what was going on there all the 19 time just because of the significant amount of 20 interaction, both legitimate and otherwise, that I had 21 with Russ Adler, so I was probably more up-to-date on 22 that group than any group other than the labor and 23 employment group, again, because I had such 24 significant interaction with Stu Rosenfeldt, both 25 legitimately and illegitimately, so I knew what was FRIEDMAN. LOMBARDI & OLSON EFTA00619672  29 1 going on in that group. 2 I tried, as best as I could, given my time 3 constraints, to stay on top of what was going on, you 4 know, throughout the firm. But I relied on other 5 people like Debra Villegas and Irene Stay and David 6 Boden, Les Stracker to the lesser extent, to monitor 7 what was going on in the different practice groups and 8 keep me up to speed. 9 Q. Was there audio and video surveillance 10 throughout the entire firm or only within your office? 11 A. No, through the entire office, not in the 12 individual offices. 13 Hang on. Not in the individual offices but 14 throughout the general office space. 15 Q. So in 2009 how many floors did you have? 16 A. Three, I think. 17 Q. And do you recall approximately how many 18 attorneys you had working there at that time? 19 A. Approximately 70. 20 Q. And when you say "not the individual offices 21 but the other areas," do you mean -- would that 22 include conference rooms? 23 A. I didn't have surveillance in the conference 24 rooms. 25 Q. So can you please tell me exactly where you FRIEDMAN. LOMBARDI & OLSON EFTA00619673  30 1 had audio and/or video surveillance? We'll start with 2 audio. 3 A. I don't have a specific recollection of 4 every place I had video and audio, but it was in -- I 5 had it set up so that in all of the common areas, 6 including our shareholder's lounge, we had -- I had 7 audio and video capabilities. 8 Q. When you say "capabilities," does that mean 9 you didn't always turn it on or you just turned it on 10 when you felt like it? 11 A. I turned it on when I felt like it, when I 12 felt like seeing what was going on. I sometimes left 13 the screen up because I had four computer screens on 14 my desk, I sometimes left the screen on with the video 15 of the reception area and some other general areas. 16 But unless I wanted to see what was going on or listen 17 to what was going on, I didn't turn it on. It would 18 have been too distracting. 19 Q. Did the attorneys know that this 20 surveillance existed? 21 A. You can see it in the -- it wasn't hidden, 22 you can see it. There were globes up in the ceiling 23 all over the office. 24 Q. Did you have -- you said you didn't 25 answer this, you said you didn't recall. Did you have FRIEDMAN. LOMBARDI & OLSON EFTA00619674  31 1 any surveillance in the conference rooms? 2 A. No. 3 Q. Other than the common areas you just went 4 over, in the hallways and the reception -- did you 5 have it in the hallways, is that a common -- do you 6 deem that a common area? 7 A. All the hallways pretty much with the 8 exception of a few blind spots, I can see all the 9 hallways. 10 Q. And this was on all three floors? 11 A. Yeah. For some reason I think we might 12 have taken some space on a fourth floor, but I could 13 be mistaken. But yes, on the three floors that we 14 actively had a significant amount of space on, I tried 15 to have surveillance on all the common areas of all 16 that space. 17 Q. And what floor was Mr. Edwards' office on? 18 A. I don't recall. 19 Q. Did you have the tort group all together or 20 was it divided up? 21 A. Except for Adler, Adler was on with -- near 22 me, down the hall from me. The rest of the group was 23 all together. I think they were on -- let's see. 24 There were people up on 22. I was on 16. He must 25 have been on the other floor that we were building FRIEDMAN. LOMBARDI & OLSON EFTA00619675  32 1 out, because I remember building out space and I 2 remember Jaffe and all those guys moving into that 3 space. 4 Q. If you were building up that space, do you 5 recall when you put the surveillance in there? 6 A. It would have been while they were building 7 it out or shortly thereafter. 8 Q. During 2009 it seems that you hired lots of 9 former law enforcement people to work at the firm. 10 Why were they people you wanted to hire? 11 A. Several old. I had a significant amount of 12 illegal activity going on with various law enforcement 13 agencies throughout South Florida and hiring people 14 from former law enforcement assisted me in engendering 15 support and camaraderie with the law enforcement that 16 I was actually utilizing in illegal activities. 17 Q. So you are saying -- 18 A. Secondarily, I wanted to have a very strong 19 investigative team, ultimately, to do both legitimate 20 and illegitimate things for the law firm, and hiring 21 former law enforcement was the best way to do that. I 22 was hoping to actually ultimately create a group. Ken 23 Jenne and I had talked about that extensively. 24 Q. Why did you hire Ken Jenne? 25 A. Prior to Ken going to prison, he and I were FRIEDMAN. LOMBARDI & OLSON EFTA00619676  33 1 very friendly and he was extremely friendly with 2 someone that was very close to me, Grant Smith. 3 During the time that he was down in FDC Miami, I went 4 down to visit him. And after speaking to him and 5 after speaking to Grant, I told him, because he was 6 talking to me about how many people had turned on him 7 and abandoned him. And I told him that when he got 8 out of jail that he had no worries, that I would give 9 him a job. 10 Q. And what -- 11 A. And that was the primary reason -- that was 12 my primary reason for hiring him. 13 Q. What was it you were hiring him to do 14 exactly? 15 A. Ultimate the goal was to head up on 16 investigative arm within RRA, within the RRA entities. 17 Q. Well, while he was there, since that didn't 18 happen, what was his obligation to the firm 19 day-to-day? 20 A. He handled firm security issues and he did 21 handle overseeing certain investigative things. We 22 had an alcohol and beverage group that was forming and 23 he was overseeing that. He was helping me find new 24 people to staff it, that kind of thing. 25 Q. Did you have a lot of interaction -- FRIEDMAN. LOMBARDI & OLSON EFTA00619677  34 1 A. He had had significant -- as you know, he 2 also had significant political connections and 3 everyone who is not living under a rock knows I was 4 doing everything I could to garner significant 5 political power. 6 Q. I think many people miss your parties 7 But, with respect to Mr. Jenne and his 8 political connections, were you hiring him to utilize 9 him with respect to any of the police department 10 investigations? You had stated earlier you had 11 dealings with police departments. I don't want -- 12 again, I don't want to put words in your mouth. You 13 said you had dealings going on with various police 14 agencies? 15 A. I had -- I mean, we had a criminal defense 16 section in the law firm, so we had legitimate dealings 17 with law enforcement. But I also had significant 18 illegitimate things with law enforcement that had 19 nothing to do with Ken Jenne. 20 Q. And how about with respect to former FBI 21 agents you were hiring? 22 A. They were all people that were operating in 23 a legitimate fashion within the law firm. 24 Q. In what role was that? 25 A. The investigative roles and the alcohol FRIEDMAN. LOMBARDI & OLSON EFTA00619678  35 1 beverage roles and anything else Ken or other staff 2 could think of to have them do. 3 Q. Let's talk about the investigative roles for 4 a minute. 5 What kind of investigations were these teams 6 running? 7 A. I do not know. You have to speak to lawyers 8 that were actually utilizing them. I put it out there 9 and Ken put it out there, that they were available to 10 lawyers in the firm for use like in-house 11 investigators. And what people did with them 12 ultimately was up to them. 13 Q. Were they on salary or were their costs and 14 fees associated with utilizing them within a specific 15 practice group? 16 A. They were all on salary with me. The 17 ultimate goal was to have it as a separate entity that 18 could bill the law firm and have the clients at least 19 defray some of the cost. I don't recall whether or 20 not we ever got to that level or not. 21 Q With all that in-house police action, why 22 did you have police security surrounding you all the 23 time? 24 A. I guess the best answer was I was paranoid, 25 but I mean -- that's the simple answer to it. You FRIEDMAN. LOMBARDI & OLSON EFTA00619679  36 1 know, having -- there were mixed reasons. For 2 example, I -- are you talking about my Fort Lauderdale 3 police detail? 4 Q. Yes. You had it at the office and at your 5 home, correct? 6 A. Yeah. There's a myriad of facts that 7 motivated me to do that. One was that I really wanted 8 the security for the office. Two was, I was paranoid 9 and this is in no particular order. Three was the 10 Melissa Lewis murder that shook the entire law firm 11 and shook me terribly. I didn't want that to ever 12 have to happen again. And four was, I wanted -- the 13 more law enforcement you have around, the 14 more legitimacy it adds t